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Refunds for fraudulent transactions

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What you can do if you’ve been a victim of debit card fraud

There are many types of debit card fraud, and you may not know you’re a victim until you see your bank statement. So what should you do if you find a fraudulent transaction?

Generally, you’re entitled to a refund if there’s been fraudulent transactions on your debit card, but like any financial product, you should read the terms and conditions when you apply. Every card provider has different policies regarding debit card fraud.

With the rise of identity theft and fraudulent transactions, more people are shying away from debit cards and relying on credit cards because they’re worried about security. It’s not quite true that credit cards are any safer than debit cards. Most debit cards come with a zero liability guarantee which protects consumers against any fraudulent transactions.

A zero liability guarantee means if you report unauthorized or fraudulent transaction, the bank will stop the transaction and no money will be withdrawn. But you need to act quickly because sometimes zero liability guarantee is only valid for a limited time. Meaning if you don’t report the problem in time, you’ll be stuck with the charges.

Debit card providers also monitor all transactions conducted on debit cards so that they can establish a spending pattern for your particular card. This allows them to identify transactions that seem out of place and they can often prevent fraudulent transactions since they will call you to confirm the payment. If you have no knowledge of the transaction, then it will not be approved and any money removed from your account will be refunded.

What is a fraudulent transaction?

A fraudulent transaction is an unauthorized transaction on your debit or credit card. This may include cards that are lost, stolen, fake, not received or fraudulent as decided by a card company. This is not the same thing as a dispute with a seller. This refers to any transaction where the seller and the buyer disagree on an issue, such as the wrong item or dispute about the price.

While putting in a claim doesn’t guarantee a refund, this could be your best bet when other options have failed. Here are the steps to make the refund process easy as possible;

  • Step 1 – Contact the merchant or website that is responsible

    The best and easiest way to handle fraud is to contact the merchant or website itself. If the merchant cooperates with you, it could mean less hassle, especially if you tell them that you’re putting in a claim with your card provider.

  • Step 2 – Gather your records

    If the merchant or website refuses to cooperate and you’re entirely sure you’re the victim of fraud, then you can start to collect all the documentation between you and the merchant, including emails and receipts.

  • Step 3 – Proof of counterfeit or damaged goods

    If you’ve purchased electronics or jewelry online, and suspect that it’s fake, you may need to prove this. Log on to the product’s official website and find the list of authorized dealers — if the website or merchant is not listed, then you can show this to your bank. If the product is damaged, make sure you take a photo.

  • Step 4 – Call your card provider and put in a claim

    Your card provider should have a customer service line. It’s best to do this right when you’ve realized you can’t get your money back any other way.

Amicable Resolutions

Disputes are often mistaken for fraudulent transactions and can be settled without the involvement of the bank. An amicable agreement is usually reached for the simple reason that if there are too many complaints against a merchant, the card issuer can refuse to work with the seller again, making it difficult to sell online. If you wish to complain to your debit card provider, then you should keep a record of all dealings with the merchant to prove that you attempted to come to a reasonable solution.

Zero Liability Guarantees

If you’re having trouble coming to an agreement with the merchant, there’s always the option of zero liability guarantee. This is a guarantee offered by card issuers where a fraudulent or unauthorized transaction will not be completed. The money will not be removed from your bank account. Keep in mind, though, that you’ll need to have written proof that the transaction was unauthorized.

Make sure that you file a claim as soon as possible, because some debit cards have a time limit on their zero liability guarantee. Also, remember that not all debit cards offer this option, so check first.

Another precaution debit card providers have is to monitor your card use so they can identify any transactions that seem unusual to your regular pattern. Usually, the card issuer will get in touch with you to confirm or deny the transaction in question. Card issuers want to keep your business and they’re doing everything in their power to limit the likelihood of problems arising.

Fraudulent transactions or merchant dispute?

It’s also important to differentiate between fraudulent transactions and merchant disputes. A fraudulent transaction is the result of identity theft and involves the use of your debit card for charges that you did not authorize.

On the other hand, a dispute with a merchant usually refers to the buyer and seller not agreeing on things like the wrong item being sent. Most merchant disputes are resolved amicably since the merchant doesn’t want to run the risk of the card issuer refusing to work with the company. If this does happen, the merchant will have a hard time selling anything online.

If you do have to complain to your debit card provider, be sure you have a record of all your correspondence with the merchant so you can prove you attempted an amicable agreement.

In conclusion, debit cards are as safe from fraudulent transactions as regular credit cards. They do, however, have a major advantage over credit cards — the inability to spend more than the amount of money you have in your account. In the long term, this will save you money in interest.

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Adrienne Fuller

Adrienne Fuller leads the publishing team at finder.com. She has one goal: to deliver the accurate and transparent information she wishes she had when she made some of life's important financial decisions. When she's not helping folks save money, she's hiking with her two Catahoulas around her home in San Diego.

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6 Responses

  1. Default Gravatar
    LarryOctober 15, 2018

    I sent money to someone via a payment app for a vacation home rental that was turned out to be fake. I used a debit card. I have records of my communication with this person and a copy of the fraudulent contract that I signed with them. I have already filed a transaction dispute with the bank. What happens next / what can I do?

    • finder Customer Care
      johnbasanesOctober 16, 2018Staff

      Hi Larry,

      Thank you for leaving a question.

      You have done everything to ensure that a refund will be processed back to you by filing the dispute via your card provider. You may also want to report this to your local police office who could further investigate on this. Hope this helps!


  2. Default Gravatar
    ChuckApril 28, 2018

    I had 4 charges from random websites get taken out of my account today drained it of 133 dollars I contacted these websites with my concerns they refused refund but all so told me two diffrent emails that made accounts with my cc info that wasn’t me am i just want my money back what can I do

    • finder Customer Care
      JoshuaApril 29, 2018Staff

      Hi Chuck,

      Thanks for getting in touch with finder.

      I understand that this can be a great source of frustration and inconvenience on your part. However, the first thing you need to do is determine if these transactions are legal or you gave your permission for them to get money from you in the first place. If not, it is time to report this incident immediately to your bank. They would most likely tell you the necessary steps you should do to get a refund. If you are eligible for a refund, they can tell you that as well.

      Generally, you’re entitled to a refund if there have been fraudulent transactions on your debit card, but like any financial product, you should read the terms and conditions when you apply. Every card provider has different policies regarding debit card fraud.

      To help you avoid future fraudulent transactions in the future and ensure you are protected against credit card scams, the following pages can help you:

      How to reverse unauthorised credit card transactions
      12 ways to avoid credit card fraud these victims wish they knew beforehand
      Credit card fraud, traps and scams: A guide to minimising the risks

      I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.

      Have a wonderful day!


  3. Default Gravatar
    MunishSeptember 26, 2017

    Someone has withdrawal money with clone ATM from my SBI account. What should I do?

    • finder Customer Care
      HaroldSeptember 27, 2017Staff

      Hi Munish,

      Thank you for your inquiry.

      If the withdrawal from your account is unauthorized. You would need to contact your bank immediately that way they can legally guide you on this matter.

      I hope this information has helped.


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